New Delhi, May 23 (UNI) The Indian domestic aluminium industry has petitioned the Government to have a re-look at the Free Trade Agreement (FTA) with China and said a strict Rules of Origin criteria is needed to check cheaper imports to India.

In a note to the Government ahead of the RECP meet on May 25, the Aluminium Association of India said from July 2019, China will take a big step in protecting its aluminium market by classifying aluminium scrap under its Restrictive Import List.

“The new norm will partially stop scrap aluminium import and impose a complete ban by 2020. This means that the global aluminium market will see a glut of aluminium scrap. In this changing geopolitical landscape, the Free Trade Agreement makes India more vulnerable,” it said.

Imports from ASEAN form a major share of value added imports led by Malaysia, leveraging the India-Malaysia FTA, which allows imports into India at zero duty while applying 25-30 per cent duty on export of India aluminium products to Malaysia.







Niti Aayog in its report titled ‘Need for an Aluminum Policy in India’ also highlighted the threat from Chinese government support and surplus capacity on global aluminium industry. It has said that aluminum imports from China into India are almost 30 times of India’s aluminum exports to China. Trade deficit for aluminum is around 690 million dollars. If duty is further cut under RCEP, domestic aluminum industry will be severely hit.

“Before RCEP is signed, the government should create a level playing field for the Indian Metal Industry in the face of competition from other trade partners.”



The Association added that India also negotiated a FTA with RCEP countries which includes China. India has been under tremendous pressure to reduce tariffs on majority of their tariff lines. While India’s trade balance with respect to China is heavily skewed in favor of China or the aluminum sector to the story is the same.



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